ACC Ltd and Ambuja Cements Ltd, both controlled by Lafarge Holcim Ltd, said they were putting on hold their proposed merger, citing constraints related to transfer of mines under current laws. The merger, which would have potentially created India’s second largest cement maker, still remains the “ultimate objective”, the companies said.
“The current regime on transfer of mineral concessions is still evolving and does not provide for a merger currently,” a spokesperson for ACC said in an emailed response to a query. “Given the challenges of achieving such transfers across 18-20 states, it was found prudent not to pursue the same at this point of time.”
For now, ACC and Ambuja said that their boards have approved an arrangement to work with each other for mutual purchase and sale of services to maximize synergies and unlock value for shareholders.
In May 2017, the boards of the two companies agreed to evaluate a potential ACC-Ambuja merger “with a view to combine the strengths of both businesses”. A special committee, comprising largely of independent directors, was formed to begin the evaluation, ACC and Ambuja Cements had said. Read More…